tag:blogger.com,1999:blog-56973322300503433652015-10-22T04:13:23.262-07:00North. East. West. SouthThe Modern Buddhahttp://www.blogger.com/profile/09262403663150092403noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-5697332230050343365.post-8330581734869147572014-12-30T11:03:00.000-08:002015-02-23T11:05:11.987-08:00Why is Russian Ruble falling?This blog post has a direct reason in the previous one <a href="http://southwesteastnorth.blogspot.in/2015/02/why-are-oil-prices-decreasing.html">Why are oil prices decreasing?</a>.The Modern Buddhahttp://www.blogger.com/profile/09262403663150092403noreply@blogger.com0tag:blogger.com,1999:blog-5697332230050343365.post-19285590251664219822014-12-19T19:18:00.000-08:002015-02-23T11:02:09.339-08:00Why are oil prices decreasing?The million dollar question indeed. Well folks there's no "one" conclusive answer, though there are many theories explaining the fall, both economic and political. Some sources have even spun a conspiracy theory around it. Next we would be hearing about aliens regulating the oil price and how CIA saves the day by fighting them(potential Oscar winning movie stuff). OK the jokes apart, lets delve deep into the mystery!<br /><br />From 2010 till mid 2014, oil prices in world has been quite stable, around 115$ per barrel. But since mid 2014 the prices have been halved nearly 59$ per barrel. There are three main reasons listed below:<br /><br /><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody><tr><td style="text-align: center;"><a href="http://l3.yimg.com/bt/api/res/1.2/kKy7xeACSR7N76xED0W73w--/YXBwaWQ9eW5ld3M7cT04NTt3PTMwMA--/https://marketrealist.imgix.net/uploads/2015/01/WTI-oil-price.jpg?w=300&amp;h=214&amp;fit=max&amp;auto=format" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" src="http://l3.yimg.com/bt/api/res/1.2/kKy7xeACSR7N76xED0W73w--/YXBwaWQ9eW5ld3M7cT04NTt3PTMwMA--/https://marketrealist.imgix.net/uploads/2015/01/WTI-oil-price.jpg?w=300&amp;h=214&amp;fit=max&amp;auto=format" height="285" width="400" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;"><span style="font-size: small;"><b>Fall in crude oil prices </b></span></td></tr></tbody></table><br /><br /><ol><li><b>Slump in demand</b> - The oil price is based on actual demand and expected demand. Due to weak economic activity worldwide there is low demand. In a meeting of OPEC countries in December it was decided to not reduce their daily production so as to keep their market share intact. </li></ol><br /><div class="separator" style="clear: both; text-align: center;"><a href="https://imfdirect.files.wordpress.com/2014/12/oil-3.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="238" src="https://imfdirect.files.wordpress.com/2014/12/oil-3.jpg" width="320" /></a></div><br /><ol><li><b>Geopolitical</b> - U.S became the largest producer of oil in world in 2014 surpassing Russia and Saudi Arabia, previously the top two producers of oil. Shale oil industry is the reason which catapulted U.S. to the number 1 position. Naturally the OPEC countries feel threatened by the new competition. There is another theory which says that due to Russia's annexation of Crimea and involvement in Ukraine has led to U.S. engineering the fall in oil prices to punish Russia which thrives on oil and gas exports. Of all countries the worst hit is Russia which saw ruble fall by 30% against dollar.</li><li><b>Conflict Situations</b> - Some of major oil producers like Nigeria, Libya and Iraq which are also part of OPEC have internal conflicts which potential oil investors see as a risk investment. For example the ISIS war in Iraq and Syria, civil war in Libya and Boko Haram insurgency in Nigeria. </li></ol><span style="background-color: white;">For curious and avid readers, find below some useful links for further research on the topic:-</span><br /><span style="background-color: white;"><span style="color: red;"><a href="http://www.economist.com/blogs/economist-explains/2014/12/economist-explains-4"> <span style="color: #073763;">The Economist explains Why the oil price is falling</span></a><span style="color: #073763;">&nbsp; - The best one</span></span></span><br /><span style="color: #073763;"><span style="background-color: white;"><a href="http://www.forbes.com/sites/realspin/2014/11/24/why-are-oil-prices-dropping/">Why are Oil prices dropping</a></span></span><br /><span style="color: #073763;"><span style="background-color: white;"><a href="http://www.reuters.com/article/2015/02/23/us-markets-oil-idUSKBN0LR01E20150223"> Oil prices fall on oversupply and refinery strike concerns</a></span></span><br /><span style="color: #073763;"><span style="background-color: white;"><a href="http://www.nytimes.com/2015/01/13/business/energy-environment/oil-prices.html?_r=0">Oil Prices: What’s Behind the Drop? Simple Economics</a></span></span><br /><span style="color: #073763;"><span style="background-color: white;"><a href="http://www.bbc.com/news/business-29643612">Falling oil prices: Who are the winners and losers?</a></span></span><br /><br />The Modern Buddhahttp://www.blogger.com/profile/09262403663150092403noreply@blogger.com0